PARIS, Dec 7, 2010 (AFP) - The society photographer and artist accused of exploiting his relationship with L'Oreal heiress Liliane Bettencourt is to keep gifts from her worth around 300 million euros, lawyers said Tuesday.

Bettencourt's daughter had accused 63-year-old Francois-Marie Banier of manipulating France's richest woman, a frail 88-year-old, and extorting a billion euros from her, but she agreed Monday to drop a lawsuit against him.

Banier's lawyer Pierre Cornut-Gentille told AFP that his client had agreed to accept no further gifts from Bettencourt and to be written out of two life insurance policies in which he had been named as her beneficiary.

He said Banier would hold on to those gifts he had already received, which are reported to be mainly in the form of valuable art works.

"These donations certainly don't represent a billion euros. This figure is a total and disproportionate fantasy," he insisted.

Bettencourt's lawyer Pascal Wilhelm estimated the value of the gifts at 300 million euros (400 million dollars), adding that the value of the two life insurance policies was around 600 million euros.

Had Banier held on to the policies, therefore, he would have brought the total value of his relationship with the heiress close to the billion euros that the daughter, Francoise Meyers-Bettencourt, had alleged.

The family fell out three years ago over the 17-billion-euro L'Oreal fortune, with the daughter claiming that her mother was mentally infirm and subject to exploitation by hangers on like Banier.

On Monday, however, the pair agreed to bury the hatchet. Meyers-Bettencourt dropped lawsuits seeking to have the shampoo and cosmetics heiress declared unfit to manage the cash and to have Banier prosecuted.

In return, her husband Jean-Pierre Meyers will have a greater role in the L'Oreal holding company.